After the ban on rice exports, India is about to attack sugar
India, the world's largest sugar producer and the second largest sugar exporter, due to insufficient rainfall affecting sugar production, after the rice ban, the Indian government is ready to continue to restrict sugar exports, which also makes the already high sugar prices, further face upward pressure.
On October 11, the media quoted relevant sources as saying that the Indian government will restrict the export of sugar in the 2023/24 season, which begins on October 1, a decision that will be announced soon, and some overseas sales quotas may be issued if India's domestic sugar supply improves in the future.
So far this year, monsoon rainfall has been 50 per cent below average in the main sugarcane-growing areas of the western states of Maharashtra and southern Karnataka, according to the Indian Meteorological Department. Together, these two regions account for more than half of India's total sugar production.
The media quoted officials as saying that erratic rainfall would lead to lower sugar production in 2023/24 and even reduce planting acreage in 2024/25. India's sugar production in 2023/24 is likely to fall by 3.3% to 31.7 million mt.
India also restricted sugar exports last year, with data showing that in the 2022/23 season, India's sugar exports were limited to 6.1 million tonnes, compared with a record 11 million tonnes in the previous season.
In September, a Bloomberg survey of 14 analysts and traders showed that most said India was unlikely to export any sugar this quarter because of lower production.
Also affected by El Niño, sugar production in Thailand, the world's second-largest exporter, is expected to fall by nearly a fifth in the next season due to severe drought.
Despite Brazil's expected bumper harvest this season, lower sugar production in India and Thailand pushed global sugar prices to a nearly 13-year high in September. According to data released by the Food and Agriculture Organization of the United Nations on October 6, the sugar price index rose 9.8% month-on-month in September, showing an upward trend for the second consecutive month to reach its highest point since November 2010.
At press time, U.S. raw sugar futures were down 0.48% at 26.91. U.S. No. 11 raw sugar futures fell 0.41% to 26.94.
